msc business management/ marketing masters dissertation · 2020. 11. 29. · i msc business...
TRANSCRIPT
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MSc Business Management/ Marketing
Masters Dissertation
SESSION 2018/19
TITLE
An Investigation on the Rise of Online Retail in the UK: In Influencing Consumer Behaviour & Purchasing
Perceptions Relating to Marketing.
AUTHOR
Mike .T. Dzinoreva 40100401
Supervisor:
Vandana Pareek
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Declaration
I declare that the work undertaken for this MSc Dissertation has been undertaken by
myself and the final Dissertation produced by me. The work has not been submitted
in part or in whole in regard to any other academic qualification.
Title of Dissertation: An Investigation on the Rise of Online Retail in the UK: In
Influencing Consumer Behaviour & Purchasing Perceptions Relating to
Marketing
Name (Print): _____MIKE .T. DZINOREVA_________________________
Signature: ___
___________________________________________
Date: __12/08/2019__________________________________________
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Abstract
The goal of the study was to view whether UK consumers are influenced in behaviour
by certain marketing concepts and conditions. That impacts particular purchasing
parameters online and future repeat purchases. Through the combination of primary
and secondary data. Hence transitioning factors of UK retail from traditional to online
purchase are shown. Consisting of modernized purchasing practices, external
promotional influences and a knowledgeable consumer base. There are signs of a
paradigm shift to cater for consumer audiences online. That are influenced by trends,
product value, convenience and social media. Online retailers such as Amazon,
Curry’s PC, and Asos are viewed categorically in relation to their consumers online.
Demographic factors view groups that influence online retail popularity and usage. As
millennials are key beneficiaries. Features supporting consumer behaviour action
cognitively and emotionally providing a decision outcome are vital. These elements
relate to convenience, time and promotion. That are the main fundamentals of online
retail as analysed in the literature and findings. Social media is an indirect contributor
to online decision making. As it relates to consumer tastes, opinions and personality
individually. This assists online retailers in getting their platforms personalised for the
consumer. Contributing to effective standardised delivery of service. Nevertheless,
benefits are stipulated to consumers as listed in the literature review. Such as market
accessibility, improved communication and autonomy of purchase. Also, drawbacks
such as security, legal issues and consumer trust factors. That are essential in
impacting consumer decisions are shown in the primary data.
Moreover, the findings insinuate that consumers have faith in online retailers as they
believe it is essential for future transactions. Also, consumers want elements of
traditional retail enforced into online retail. Such as human interaction, feedback and
product knowledge. Additionally, consumers want their online experience to suit their
needs conveniently. Such as using smartphones for portability and laptops at home
because of its appeal and usage. Consumers prefer buying electronic and clothing
products online than groceries. Due to their complexity and differentiation factors.
Nevertheless the findings allowed the formation of conclusions and recommendations.
Highlighting consumer fundamentals in online retail. As suggestions for consumers
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and marketers were applied. Indicating appropriate action of online retail use and how
to deal with curial factors that stimulate consumer behaviour. As results indicate the
ability to purchase based on convenience, priorities, quality of retailer and its range
according to the consumers' needs.
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Acknowledgements
Firstly want to thank all the participants that contributed to the study.
Moreover appreciate the support from Vandana Pareek who supervised the
dissertation process. Providing the researcher with essential advice and motivation
throughout.
Furthermore want to thank all the respondents in the survey.
Also my flat mates, university and work colleagues that provided support and
motivation during the tough periods of the study.
Lastly my parents Mike and Raviro Dzinoreva, for giving the incentive to complete
the study.
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Contents
1. Introduction ....................................................................................................................................... 1
1.1 Background................................................................................................................................. 1
1.2 Context ........................................................................................................................................ 1
1.3 Researchers Agenda ................................................................................................................ 3
1.4 Aims & Objectives ..................................................................................................................... 3
1.5 Reasons for Objectives ............................................................................................................. 4
2. Literature Review ............................................................................................................................. 5
2.1 Introduction ................................................................................................................................. 5
2.2 Current State of Retail Industry in the United Kingdom ....................................................... 5
2.3 Consumer Purchasing Behaviour in the United Kingdom ................................................... 7
2.4 Context of Decision-Making Process ...................................................................................... 8
2.4.1 Product Screening in Purchasing Decision .................................................................... 9
2.4.2 Specificity of Product to Consumer in Decision Making ............................................. 10
2.4.3 Extent to which Consumers Feel that Purchase fits their Needs .............................. 10
2.5 Online Retail Evaluation (Consumer Alternatives, Perceptions & Attitudes).................. 11
2.5.1 Consumer Alternatives and Choices ............................................................................. 11
2.5.2 Consumer Perceptions towards Type of Product ........................................................ 12
2.5.3 Product/ Online Platform Recommendations for Efficient Customer Purchase ..... 13
2.5.4 Consumer Attitude towards the Need to Purchase ..................................................... 14
2.6 Purchasing Process for Consumer ....................................................................................... 16
2.6.1 Economic Conditions Influencing Consumer Purchasing Behaviour ....................... 19
2.6.2 Marketing Campaigns by Retailers Targeting Consumer Behaviour ....................... 19
2.7 Benefits of Online Retail for Consumers .............................................................................. 20
2.7.1 Increased Accessibility to the Market ............................................................................ 21
2.7.2 Improvement of Communication Channels .................................................................. 22
2.7.3 Allows Consumer to be Autonomous ............................................................................ 22
2.8 Drawbacks of Online Retail to Consumers .......................................................................... 23
2.8.1 Security Fraud & Legal Issues ....................................................................................... 24
2.8.2 Delivery & Trust Factors .................................................................................................. 26
2.8.3 Lack of Universal Interactively & Shopping Experience ............................................. 26
2.9 Future of Online Shopping & its impact for Consumers in the United Kingdom ............ 27
2.9.1 Traditional & Online Rivalry ............................................................................................ 28
2.9.2 Consumer Evolution in Decision Making ...................................................................... 29
2.10 Conclusion .............................................................................................................................. 29
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3. Research Methodology ................................................................................................................. 31
3.1 Introduction ............................................................................................................................... 31
3.2 Research Approach ................................................................................................................. 31
3.3 Research Methods .................................................................................................................. 32
3.4 Research Plan/ Design ........................................................................................................... 32
3.4.1 Source of Survey Questions ........................................................................................... 34
3.4.2 Survey Distribution ........................................................................................................... 37
3.4.3 Pilot Test ............................................................................................................................ 37
3.4.5 Sample ............................................................................................................................... 38
3.4.6 Data Analysis .................................................................................................................... 38
3.4.7 Research Ethics ............................................................................................................... 39
3.4.8 Reliability and Validity ...................................................................................................... 40
3.4.9 Limitations ......................................................................................................................... 41
3.5 Conclusion ................................................................................................................................ 41
4. Findings & Analysis ....................................................................................................................... 42
4.1 Introduction ............................................................................................................................... 42
4.2 Sample Data Description ........................................................................................................ 42
4.2.1. Demographic Profile ....................................................................................................... 43
4.3 Consumer Use of Online Services ........................................................................................ 46
4.3.1 Online & in store Frequency ........................................................................................... 46
4.3.2 Internet Usage .................................................................................................................. 48
4.4. Consumer Device Usage Experience ................................................................................. 49
4.4.1 Convenience (Smartphone, Laptop, Desktop, I-pad) ................................................. 50
4.5 Influencing Factors that Decide Online Purchase .............................................................. 52
4.5.1 Preferences (Online promotion, in store promotion, likelihood to purchase) .......... 54
4.6 Perceptions and Opinions of Online Services ..................................................................... 56
4.6.1 Human Interaction ............................................................................................................ 57
4.6.2 Recommendations to Family & Friends ........................................................................ 57
4.6.3 Personal Data for Social Media Improved Services ................................................... 57
4.6.4 Trustworthiness of Retailers ........................................................................................... 57
4.6.7 Product Updates relevance in Purchase ...................................................................... 58
4.6.8 Online Retail Beneficial for Future Business Consumer Relations .......................... 58
4.7 Rating Usage & Quality of Various Online Platforms ......................................................... 58
4.7.1 Correlations ....................................................................................................................... 60
4.8 Conclusion ................................................................................................................................ 63
5. Recommendations & Conclusions .............................................................................................. 64
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5.1 Introduction ............................................................................................................................... 64
5.2 Research Gap Literature Review .......................................................................................... 64
5.2.1 Objectives 1&2 .................................................................................................................. 65
5.2.2 Objective 3 ......................................................................................................................... 66
5.2.3 Objective 4 ......................................................................................................................... 67
5.2.4 Objective 5 ......................................................................................................................... 68
5.2 Contributions to Knowledge Study Provides ....................................................................... 68
5.3 Recommendations Marketers & Consumers ..................................................................... 70
5.4 Limitations ................................................................................................................................. 71
5.5 Recommendations for the Future.......................................................................................... 72
6. References ...................................................................................................................................... 73
7. Appendices ..................................................................................................................................... 92
Appendix 1: Online Questionnaire Template ............................................................................. 92
Appendix 2: SPSS Spreadsheet .................................................................................................. 96
Appendix 3: Consent Form ........................................................................................................... 97
Appendix 4: Age Frequency of Respondents ............................................................................ 98
Appendix 5: Human Interaction .................................................................................................... 98
Appendix 6: Recommendations Family & Friends + Opinions ................................................ 99
Appendix 7: Personal Data Social Media ................................................................................... 99
Appendix 8: Personal Data Improved Service ......................................................................... 100
Appendix 9: Trustworthiness Consumers Information ............................................................ 100
Appendix 10: Product Information Updates ............................................................................. 101
Appendix 11: Future Online Retail ............................................................................................. 102
Appendix 12: Hypothesis Validation .......................................................................................... 102
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List of Figures
2.1 Online Retail Promotional Visualization…………………………………………18
2.2 Consumer Purchasing Process Directive……………………………………….22
2.3 Purchasing Power of Consumer/ Retailer Relationship……………………….23
2.4 Integrative Framework of Consumer Trust for Online Services………………29
2.5 Integrating Consumer Behaviour Factors to Analyse Decision Making……..33
3.1 Research Onion Philosophy………………………………………………………39
4.1 Percentage of Gender Respondents …………………………………………....49
4.2 Percentage of Age Respondents………………………………………………...50
4.3 Occupation Level of Respondents……………………………………………….51
4.4 Residency Status of Respondents……………………………………………….52
4.5 Internet Usage Morning…………………………………………………………...55
4.6 Internet Usage Afternoon………………………………………………………….55
4.7 Internet Usage Evening …………………………………………………………...56
4.8 Smartphone Convenience…………………………………………………………57
4.9 Laptop Convenience………………………………………………………………..58
4.10 Desktop Convenience……………………………………………………………..58
4.11 Purchasing electronics Online…………………………………………………….61
4.12 Purchasing Clothing Online………………………………………………………..61
4.13 Purchasing Groceries Online ……………………………………………………..62
5.1 Maslow’s Hierarchy of Needs............................................................................76
5.2 Hofstede’s Culture Insights……………………………………………………….…77
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List of Tables
2.1 Purchasing Process for Consumer………………………………………………….21
2.2 Business/ Consumer Trust Factors…………………………………………………26
3.1 Sources & Reasons for Survey……………………………………………………...42
4.1 Number of Responses………………………………………………………………..48
4.2 Frequency of Online Retail…………………………………………………………..52
4.3 Frequency of In store Retail………………………………………………………….53
4.4 Descriptive Analysis of Online & In store Retail……………………………………53
4.5 Descriptive Analysis of Internet Usage……………………………………………...54
4.6 Descriptive Analysis of User Devices……………………………………………….57
4.7 Descriptive Analysis of Online Purchase Decision Influences……………………60
4.8 Descriptive Analysis of Online Purchase Item……………………………………...60
4.9 Recommendations to Improve Online Retail……………………………………….63
4.10 Product Usage of Online Retail Outlet……………………………………………..65
4.11 Product Quality of Online Retail Outlet…………………………………………….66
4.12 Correlations of Online Retail Quality……………………………………………….68
4.13 Correlations of Online Retail Usage ……………………………………………….69
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List of Abbreviations
B/C: Business Consumer
CRM: Customer Relationship Management
E.g.: Example
FAQ’s: List of Questions
I.e.: For Instance
JL: John Lewis
M&S: Marks & Spenser
PT: Pilot Test
SM: Social Media
SPSS: Statistical Package for Social Sciences
UK: United Kingdom
USA: United States of America
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1. Introduction
1.1 Background
Online retailing is an element of electronic business enabling customers to purchase
products from a distributor via the internet (Miriti, 2016). Hence online retail has
become one of the most discussed topics in the UK and certain parts of the developed
world. According to Evanschitzky, et al., (2004); Woltinburger & Gilly, (2003) online
retail enables retailers to transform consumer purchasing experience dynamically and
interactively. Nevertheless this has conveniently impacted various stakeholders such
as communities, consumers and organisations.
Eng & Kim, (2006) states consumers react pessimistically to innovation.Nevertheless
an article by Open University (2018) conveys that the internet influences the way we
shop. As British retailers are identifying that the internet is transitioning consumer retail
experience realigning the high street as well. Another contributor is social media as
Ecommerce News (2018) highlights that SM influence in online retail keeps growing
with women, youth and consumers staying in urban areas highly likely to purchase a
product online after seeing it on SM.
Nevertheless this chapter focuses on the research settings and frameworks that will
be developed in later chapters. Also, highlighting reasons for the research being
conveyed with references from academics, organisations and the researcher’s
personal experience.
1.2 Context
The context of this research was formed to challenge researchers, organisations and
academics who have conveyed studies about online retail and its development
amongst various spectrums of commercial retailing. However the researcher believes
in a gap of this phenomenon transforming consumer’s behaviour purchasing habits.
Especially in a market such as the UK where it is corporate profit orientated.
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Glen Tooke a customer insight executive at Kenter World panel emphasises that
online retail is increasing at the expense of offline platforms (Financial Times,
2018). Hence, the researcher believes giving the consumers perspective would
highlight the cognitive and emotional elements that transpire during the online
shopping experience. From marketing awareness to the purchasing action. That
would provide an indication why online retail has become so popular particularly in
developed countries such as the UK.
In terms of past studies Donthu & Grace (1999); Greissler & Zinkov (1998) are some
early academic researchers that have analysed online consumer behaviour. Then with
e-commerce strategy Quech & Kien (1996) & Watson et al. (2000) are early adopters
of this subject. Additionally, Kuester, (2012) views consumer behaviour as analysing
groups, individuals and processes they use to dispose and secure service experience
to gratify needs.
Moreover as traditional retail is the main platform for consumers. The purchase
behavioural aspects are based on this form of retail. Online retail has provided a form
of competition for the old practice. Hence this has allowed researchers and retail
experts to assess how this has changed the purchasing narrative. Adding online
platforms as supporting factors can increase customer service and loyalty. As they are
engaged more on the platform due to their control of the purchase outcome (Zhung et
al., 2010).
According to Kim, (2010) purchasers with significant involvement in the product tend
not to mind going to shopping outlets for information. However the purchaser with low
product engagement would be enticed by online transactions. Li, Bourne & Wetherbe,
(2006) suggests from the consumer perspective that web platforms can be applied to
satisfy requirements like purchasing of new product data. Moreover Ducoffe, (1996);
Zhou & Bao, (2002) views that online advertisements take advantage of this retail
phenomenon to choose marketing appropriately to align themselves to online
behaviours of customers.
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1.3 Researchers Agenda
The researcher has been led to this topic as a regular consumer of products online.
However, this transition occurred recently having been a long time in store purchaser.
Additionally, with various forms of online retail such as Business/Business,
Business/Consumer and Consumer/Consumer (Miriti, 2016). The researcher’s study
focuses mainly on the consumer’s perspective of what influences these behavioural
changes in purchasing. Especially with a UK market that has a profound retail
environment with outlets such as ASDA, John Lewis, and Curry’s PC etc.
Moreover, having studied marketing for years and conveying experience of working in
retail for Gap Edinburgh. The researcher feels they can develop a conclusive outcome
as both sides are relatable in this case. Also, with modules studied such as Global
Marketing, Direct & Digital Marketing, and Marketing Communications etc. It provides
a supporting base to the researcher's application of academic principles in the study.
Hence, the direction of the study identifies the key components by focusing on the aim
to achieve the objectives below. With the literature review focusing on the academic
concepts and practices that relate to consumers perspective in behaviour and the
elements involved in achieving that thinking. Additionally, the research methodology
will direct what/how data needs to be gathered and how to analyse findings to develop
recommendations and conclusions.
1.4 Aims & Objectives
The aim of the research is to examine whether UK online retail consumers are
influenced in behaviour by certain marketing concepts and market conditions. That
impacts purchasing decisions online in terms of product selection and future
purchases.
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Objectives are;
1. Identifying online retail trends that have influenced consumer behaviour in
various online retail industries.
2. Critically reviewing the literature surrounding online retail, establishing the
main marketing factors that influence consumer purchasing decisions in
online retail.
3. Underpinning the compatibility of online retail using a survey
to analyse consumer purchasing habits and preferences.
4. Evaluating using findings of online retail market concepts that drive sales,
by analysing potential compliments and implications for consumer
behaviour.
5. Offering recommendations based on the findings, to how retailers/
consumers can identify behavioural transitions online using certain
marketing concepts to maintain consumer confidence.
1.5 Reasons for Objectives
The objectives are listed to provide a logical structure of the study. This is an attempt
to condense the information and use data that is necessary to the study goal.
Especially as the topic is quite broad. The 1st 2 objectives focus on the background
study of online retail and its impact on consumers in terms of literature and context.
The 3rd and 4th objectives focus on the data collection and evaluation through findings.
Using information gathered from the 1st and 2nd objectives to develop a methodology
and an execution of the survey. Lastly the information gathered will provide reliable
recommendations to accomplish the 5th objective.
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2. Literature Review
2.1 Introduction
In this chapter the author is going to focus on the first 2 research objectives highlighted
in the previous chapter. Hence factors such as consumer decision making, online retail
evaluation, purchasing process, benefits of online retail, drawbacks of online retail and
the future of online retail. Are going to be the focus of the research identifying the
factors contributing to the 3rd objective. That will be developed from primary research
in the next chapter. Moreover, specific marketing models to identify consumer’s
behaviours and attitudes towards products online and in store, would be used. Giving
an indication of how the industry is performing and transitioning. Also, viewing what
macro and micro factors are leading to consumers being led to online retail purchases.
Lastly a conclusion is going to be done to review what has been discovered leading
into the next chapter.
2.2 Current State of Retail Industry in the United Kingdom
According to Thomas, (2015) the genesis of online retail was by Michael Aldrich in
1979 who used videotext (a double message platform) to evolve retail. Which in this
era is viewed as e-commerce. Nevertheless this has created convenience for the
consumer variously. Such as quick access to products, variations of selecting products
from different retail outlets and saving time in going to the shop physically.
Moreover, this phenomenon is multifaceted in terms of not only benefiting
the retailer but the consumer. Papagiannidis et al., (2014); Dennis et al., (2014)
& Pentano, (2016) emphasises that as technology advances, retail outlets are now
seeing the advantages of innovations that apply various systems such as self-service
technologies, mobile apps and internet websites. In the UK there are companies that
operate solely by online retail with the components highlighted in the previous
sentence such as, Curry's PC, Debenhams, John Lewis, Marks & Spenser, ASDA,
Tesco, Asos, E-bay, Argos and Amazon (Disfold, 2019).
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This highlights how the UK is a dynamic and diverse market. In terms of e-commerce
as it caters for the consumer for fundamental aspects such as electronics, clothing,
groceries, home appliances + furniture etc. Highlighted in 2017 as British retail sales
were worth £ 595 billion. Then for every pound spent.
39 pence/ food shops
12 pence / clothing shops
9 pence/ automatic fuel
8 pence/ household goods [electronics & furniture]
Furthermore online retail sales accounted for 18% in August 2018 increasing from 5%
in January 2018 (Deloitte, 2019). According to the House of Commons, they provide
a similar figure of 20%. Moreover, this form of shopping is more popular in the UK than
in any other European country. In the UK 82% of people made one purchase online in
2017, similar to Denmark and Sweden (Rhodes, 2018). According to Deloitte (2019) it
was a hard year compared to the past; contributed by the industry being in its
transitional period with traditional channels stalling and new channels being re-
invented.
As the future becomes more digital, the figures indicate that online retail will influence
a significant amount consumer's daily. Hence retailers must find the best methods of
delivering their products to the consumer effectively online without removing the
traditional measures.
With Amazon and EBay providing all in one, it provides consumers an indication that
organisations are making the shopping experience more accessible and personalized.
Providing power of purchase to customers from the comforts of their own home. Hence
the researcher believes online retail is going to some extent cause the down fall of in
store purchases (see section 2.9) for the future. Despite the figures for traditional retail
still looking potent for the meantime.
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2.3 Consumer Purchasing Behaviour in the United Kingdom
Consumer behaviour keeps changing rapidly according to how the market is
advancing to suite the customer's needs. According to Koufaris, (2002), past literature
investigated this subject of consumer behaviour and focused on the factors that are in
store when the consumer has a supporting base regarding to staff.
However there is a growing need for retailers to discover consumer thoughts
independently in their decision-making process online. As latest technologies such as
smartphones, are viewed as supporting systems for consumers that leads to the
assessment of the purchasing experience. Such as brand loyalty, improved buying
decisions and satisfaction (Koufaris, 2002; Fiore et al., 2005 & Kim, 2011). As the
cognitive factors of the consumer are constantly being influenced by what is trending.
Hence there is a need to keep with society feelings to adopt the standard at that time
period.
Additionally, the retail sector has been going through a long transitioning period, with
factors such as rising online purchases, changing customer attitudes and uncertain
economic environment (Rhodes, 2018). As a result, retailers are evolving their
interactive ways with consumers on a marketing and product delivery approach
(Rhodes, 2018). In terms of consumer confidence Savills, (2019) highlights that
consumer inflation price and unemployment has been stable that has contributed to
the increase in real earnings.
However, with Brexit uncertainty it seems that consumer behaviour to purchase might
get impacted, with consumers looking to save or spend their money on
essentials. According to Deloitte, (2019) consumer confidence has fallen due to the
slow global economy hence customers remain cautious. Also, companies had more
discounts at end of year more than previously in recent years with an increase of in
store closures, a 36% increase from 2018 (Deloitte, 2019). That could impact on the
sale trends of online retail in the long run. Impacting organisations such as John Lewis
and Curry's PC that offer high valued products. Due to consumers prioritizing their
purchasing options in terms of what they need mostly.
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Blazquez, (2014) emphasises when it comes to high involvement products such as
clothes in e-commerce, they tend not to do well compared to traditional sales. That
shows consumers still want to have physical interaction and customer business
relationship with clothing retails. As seen in the UK as traditional profit levels are still
decent despite the rise of online shopping. So, these factors that are external
economically and internal organisationally potentially can influence consumer decision
making processes. Especially if it is going too led to traditional outlets shutting down.
Moreover highlighted in section 2.4 showing what is essential for consumer making a
purchase decision that can be influenced by emotional, cognitive and affective
measures.
2.4 Context of Decision-Making Process
Various literature emphasises that customer’s cognitive personalities in online retail
behaviors are vital for marketers on the internet (Anichai- Hamburger, 2002; Chak &
Leung, 2004; Gupta, Su & Watter, 2004). Furthermore, customer mindfulness sets
forward their motivation for purchase behaviours in the future highlighting the
perceived outcomes (Rajamma & Pelton, 2009). So, it is key to notice that online
shopping and consumer behaviour must be analysed together. To see the benefits for
the consumer in the long run (furthermore discussed in section 2.7). So, to understand
this in depth the aspect of online retail to consumer needs. Regarding internal and
external elements have to be valued in assessing the impacts on decisions. According
to Mittal, (2013) internal aspects derive from the customers mind then external
elements from environmental state. These include;
Internal: psychological trends such as/ learning perspectives, attitudes,
motivations & self- image.
External: technology, culture, sub – culture, marketing, public policy,
socio- economics & reference groups.
Moreover Seth (1983), noted functional and non- functional types of motive when
customers are shopping. These include:
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Functional: shopping place, time, customer needs, cost of product and
availability to select various products.
Non -functional: related to social or culture fundamentals such as the
organisation or brand name.
Furthermore Mittal, (2013) insists what would impact on customers behaviour would
be advertising. As businesses provide the incentive to visit and purchase that provides
value for later usage. Nevertheless, in this case consumer purchasing power has been
strengthened as online shopping provides autonomous means of selection. By
directing towards what the consumer needs precisely or closely, as highlighted in
section 2.3. Varadarajan, et al. (2010), supports this by saying the internet has
provided strength to the bargain position of customers. By contributing comprehensive
apparatus to receive data used by various mediums.
2.4.1 Product Screening in Purchasing Decision
Nubeity, (2018) goes ahead to say that retail preferences are vital to fruitful
transactions online and traditionally. Also, emphasises as the internet becomes more
engrained into society it is contributing to key changes in human behaviour and activity
(Nubeity, 2018). Hence the author feels that it has contributed to the decision-making
process. Especially as consumers are more engaged on SM platforms such as
Facebook, Twitter and Instagram. That provide an emotional connection to their
decision as their personal information is used on those platforms. Leading to retailers
taking advantage and using that data to market their products to what relates to the
consumer. (Linking to section 2.8.1 about data usage).
Which is the process that ignites the interest of a product subconsciously. However,
this form of engagement is accepted by the market generally. As Bourlakis et al.,
(2008) states that online purchasing behaviour from the development of the internet
era has been accepted by the marketing fraternity. However, to those that get
impacted with these developments there is a grey area. In terms of data protection
which is going to be expounded later in section 2.8.1.
Alternatively, Ali & Sankaran, (2011) points out electronic communications through
FAQ’s online can clarify user information and increase their experience in the decision-
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making process. Therefore overtime would increase consumer confidence and would
result in them purchasing the same item from the online site. As their trust is solidified
due to regular interaction with the organisation, (viewed more in section 2.7).
2.4.2 Specificity of Product to Consumer in Decision Making
Additionally, it has been highlighted by Senecal et al., (2005) that consumers apply an
internal search when selecting a product. Using their experience knowing the brand
or product. Alternatively, to make sure a consumer could use external measures by
seeking recommendations of the product from other buyers (Senecal at al., 2005).
So, purchasers can use various approaches of decision making to make a buying
decision (Payne et al., 1993). Peterson & Marion, (2003) stresses that customers
spending online can adjust the procedure of searching for data to make use of certain
features that the internet provides.
Literature shows if there is a recommendation to the consumer to purchase a product.
There is a 50/50 chance of them liking or not. If not, an ‘affect’ referral would be used
(Olshavsky, 1985). It has been alluded that consumers that rely on their own decision
making do not base their choice on alternatives or characteristics but on past
occurrences (Senecal, 2005).
2.4.3 Extent to which Consumers Feel that Purchase fits their Needs
It has been highlighted by Chen, Gillenson & Sherall, (2002) that incentive
measures such as product quality, information access and obtaining the
product are swiftly changing online shopping. Podder, (2009) as online trade is a
distant transaction, consumers cannot use the product immediately due to delivery.
As would be one of the failures of online factors discussed in section 2.8.
When researchers view this it shows consumers are engaged with the new online retail
changes. That are allowing their experience to improve from traditional shopping in
terms of convenience (discussed in section 2.7.1). But there are always setbacks such
as the delivery process that consumers are willing to overlook as the benefits overlook
the cost of waiting. Especially in this environment when people are too busy with work
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and family commitments. That they are just happy if the product arrives as ordered.
Therefore will scale their need for the product to make a repeat purchase. Or,
alternatively go back to the traditional way. As they may feel their experience out ways
their product needs.
2.5 Online Retail Evaluation (Consumer Alternatives, Perceptions & Attitudes)
2.5.1 Consumer Alternatives and Choices
Traditional purchases have always been popular even in this highly technological
environment. As people trust what they have used always if it is not necessary to
transition. Alternatively, the online retail boom is complementing traditional aspects as
consumers can look at a product before deciding going in store or purchasing online.
Melis, (2015) emphasises that online shopping and multi- channel aspects are
becoming vital in the constant transitioning retail sector. As a result, online store
portfolio's, are being added to various retail stores to support consumers driven needs
(Carini et al., 2010).
According to Washuam, (2012) in the supermarket industry multi-channel retailing
leads the agenda with top retailers. This has created a choice option for consumers
and expanded their purchasing prowess. In a country where online retail is prevalent
such as the U.S, online shopping is expected to increase from 3.3% to 11% by 2023
(Steiman, 2014). This trend is being assisted by consumers driving towards e-
commerce elements due to its various exclusive aspects.
In the UK Morrisons in 2013 was not engaged in online shopping. However, their CEO
emphasised if they do not transition the consumer will be driven to competition
platforms such as Tesco, Sainsbury and ASDA (Rankin, The Guardian, 2013 p 41).
Wiggenraad, (2017) highlights that retailers should try to adapt in their strategy as
there is no consistent formula for success as the industry is consumer lead. However,
there is a suggestion that stores provide a certain unique intimacy and swiftness that
online retail misses. However division is being bridged as the delivery gap is
narrowing.
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Additionally, it has been noted that retailers are taking for granted customer flexibility
of fulfillment and crowds' pace in online demand (Wiggenraad, 2017). Hence
consumers will look for the best online platform that would appeal to all their
requirements. As online retail is sporadic in totality, especially with grocery and fashion
retailers due to businesses applying their own standards. Which they feel will apply to
their own target base. Hence reason Amazon booming in the UK because it is close
to consumer expectations. In terms on online retail experience and variation of
products.
2.5.2 Consumer Perceptions towards Type of Product
As internet usage becomes more with the increase of information and technology, the
shape of online purchasers continues to transition. So buying tendencies tend to be
diverse due to different and growing customer individualities with the categories of
amenities and products provided (Saprikis, Chouliara & Vlachoupoulo, 2010). Hence
reason why consumer theorists and e-commerce executives are moving towards
grasping, consumer choices in products and distribution channels in terms of usage
and avoidance (Saprikis, Chouliara & Vlachoupoulo, 2010).
The author goes further to suggest, that products marketed online link to what the
consumer would purchase. I.e. if a purchaser has a general interest in electronics they
would tend to be convinced to buy online. Especially if the promotional medium allows
their purchasing behaviour to be activated. So, if Curry's PC analyses their new
products and functions online. There would be an interest particularly if the consumer
has shopped at the outlet traditionally. That allows trust to be developed prior to
interest leading to purchase.
Similarly, if Asos promotes their products on SM platforms and the consumer keeps
visualizing the component they would eventually be led to buy online. Also the more
the product is promoted to the targeted consumer, it creates a positive perception
about the brand item and channel being used to market the products. (See figure 2.1
and table 2.1 section 2.5.4). Creating a bridge, to cover uncertainty that usually is
indicated when consumers purchase online, due to various purchasing procedures
unlike traditional stores (Dellarocas, 2003).
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Figure 2.1. Online retail promotional visualisation
Source: Orendorff, (2019)
2.5.3 Product/ Online Platform Recommendations for Efficient Customer
Purchase
Researchers have suggested that ambiguity may concern organisations that solely
provide online stores than traditional outlets that provide online as well (Chatterjee,
2001). Solely online examples in the UK would be Amazon, Ebay, and Asos. Meaning
consumers base their experience and recommendations on the online review platform.
Than having the chance to go in store to clarify their product needs.
That could have a significant impact on their purchase behaviour in the long run.
However, as there a few solely online platforms it might not impact on consumer’s
decisions to purchase on the platform in the short term. However long term, as
alternatives get developed the consumer might be spoilt for choice. Leading them to
go search the platform that can deliver them the best shopping experience.
So, as consumers become affluent with online platforms there is a constant
expectation of improvement required. To feel that the next purchase is new and unique
in providing value in purchase. Magee (2003) emphasises that the increase in the
figures of online purchasers is contending with the number of web users. Showing
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people who use the internet are becoming more settled to purchase
online (Saprikis, Chouliara & Vlachoupoulo, 2010).
So, to provide an efficient service consumer opinion online is important, to decentralize
the online apparatus and focus on specific elements that would appease the
consumers characteristics that connects them to the product. Hyun Hwa, (2012)
indicates that online reviews benefit retailers but consumers particularly. Yao et al.,
(2009) furthermore deduces that optimistic reviews intensifies the customer’s
motivators to purchase a product. Nevertheless, studies have not fully explained the
impact of reviews on consumer conduct. Moreover, it has been revealed by studies
that classes of some products attract consumers more than items that are not
reviewed. So, it's essential to look at perceived costs and benefits of reviews online
as it links to the attitude of consumer’s need to purchase (Hyun Hwa, 2012).
2.5.4 Consumer Attitude towards the Need to Purchase
It has been viewed by Chen & Chang (2003) that consumer’s fundamental aspects of
purchasing online is price and convenience. Moreover, being able to buy without
leaving their home is what intrigues consumers. Hawebel & Trifts (2000) further
indicates that using online instruments such price examining and judgements delivers
an extra advantage in the customer’s decision making. As products can be bought at
the least available price (Hawebel & Trifts, 2000).
Other literature indicates that the features/ website design, feedback from prior
customers, discounts and time saving factors contribute to the attitude of the consumer
to purchase (Gotland, 2011). Security is also key as discussed in section 2.8.1. These
factors are key to motivate the consumer to purchase the products and the more these
factors are satisfied. The higher the chance of repeat purchases and
recommendations to other potential consumers as highlighted in section 2.5.3.
A further analysis of these factors can be viewed below:
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Influencing
factors Reasons Literature/ Evidence
Convenience
Simpler than traditional shopping.
Better than visiting the store to search for the product you want.
Customers can simply examine product lists.
Robinson,Riley, Rettie & Wilson, (2007) major motivator is convenience and having a bulk of items delivered at home. Also being able to shop anytime. According to Rohm & Swaminulhans, (2004) online shoppers are classified as balanced purchasers, conscience buyers, and diverse product seekers, based on their current purchasing motivations. This being consistent with Morgaonosky & Cude, (2000) research findings. Futhermore highlighted by Webchecks’s, (1999) that convenience is a major factor of online retail.
Time Saving
Saves time when buying products.
Removes the travel time required to go in store.
Nevertheless, some people think delivery of products is time consuming
Corbatt, (2001) emphasises that saving time is not considered mainly as a push factor for consumers to purchase online. Additionally, Goldsmith & Bridges (2000) highlights there is a distinction among non-web buyers and online buyers. As non – online buyers are concerned about security on time delivery & privacy, then online buyers about variety, suitability & saving time.
Website Design/ Features
Important in swaying factors of shopping online.
Reliability & consumer service efficiency essential.
Contribute to negative or positive feelings about a website.
Successful transactions are guided by quality features; that lead to revisit to the website.
A study carried by Kameriah & Sahweni (2005) indicates that significant website quality influences consumers to purchase online. The perception of consumer on the website for online buying influenced by privacy, reliability, and consumer service (Shergill & Chen, 2005). Additionally, Liang & Lai (2000) state that design of the web page is vital
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for choice for customers of online stores. Also, a study by Yosmic & Mic (2010) confirms that there is a link between features of the website & online buying activity.
Security Secured transactions provide consumer website trust.
Consumers avoid online platforms because of risk, non- delivery bank card fraud etc.
Granyet & Gauten (2004) online shopping with advanced technology is trusted more. Leading to regular online shopping that provides additional confidence of trust to the consumer.
Table 2.1. Factors that influence consumers need to purchase
2.6 Purchasing Process for Consumer
Following from section 2.5, it can be seen that consumer’s alternative to online retail
is in store. Even if they do not get the delivery at their residence they would eventually
have to go in store i.e. click & collect or return. Hence the purchasing process leading
to the decision needs to be viewed. Studies have highlighted the process of purchase
can be analysed by a data processing method (Bethmen, 1979). As a customer gets
the data, assess it, then decides. Furthermore Bethman Luce & Payne, (1998) states
that the decision making procedure is formed by the customer and it is constructive.
See figure 2.2.
* 1st frame shows the purchase factor as a key component of the process that is in
favour of online business in terms of profitability. *However the 2nd frame focuses on
the consumer as the key component to deliver online distribution success.
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Figure 2.2. Consumer purchasing process directive
Source: Ordedorff, (2019)
These decisions can be based on individual characteristics or by influence of
marketing material that allows impulsive buying (Arccgoncillo, 2018). This has various
researchers looking into consumers measuring their impulsive behaviour via social
experiments that mostly results in participants not fully engaging in the type of products
they aspired to buy (Kollet & Wiilet, 1969). However, there is no agreement in research
about the concept of impulsive buying (Arcgoncillo, 2018).
It has been noted that unpremeditated purchases are not derived from pessimistic
feelings or significant desires that are related to impulsive purchasing (Amos et al,
2014). Hence, impulsiveness depends on the consumers characteristics that is difficult
for marketers to predict unless if they focus on purchasing habit trends. Ultimately the
decision to purchase may be influenced by the market in terms of appeal and
relevance. That impacts on the output in terms of adoption and product satisfaction.
See figure 2.3 below:
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Figure 2.3. Purchasing Power of Consumer/ Retailer Relationship
Source: Karimi, (2013)
The consumer in online retail is the epicentre of deciding whether the product is ideal
to their satisfaction. (Seen in figure 2.2). As most of ordering dealings are done by the
purchaser, regarding describing product information and where it should be delivered.
Hence retailers should adapt to form a consumer business relationship with their
clients. As this serves a major role in delivering the product efficiently.
According to Sanpera, (2017) retail purchasing power is there to focus on consumer
online accurately, to target their offline buying habits. Wallace (2018) indicates that
what consumers want compared to retailer's product delivery is not in sync. As modern
customer behaviour keeps on altering due to constant innovations. Hence retailers
should keep the platforms online modified. As the consumer is constantly modifying to
society technological advancements.
Furthermore these advancements are not in marginal sizes but in large groups as
once something trends it becomes a domino effect. E.g. the way consumers are
always up to date with Apple products. Since this is their main source for shopping
online it would be essential for retailers to keep their service software updated. Also,
understanding consumer wants on the platform in terms of information and aesthetics
that can be collected for reviews as described in section 2.5.3.
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2.6.1 Economic Conditions Influencing Consumer Purchasing Behaviour
According to I-Research (2018) consumer behaviour is deemed to be the actions that
impact the buying attitude of a customer. Choosing a product item is based upon
selection and reasoning. Hence this can be influenced by external factors that are
induced by the economy or the society outlook of that country.
The UK government recognizes the importance of e-commerce and its value to the
consumer. Hence, they have implemented legislative measures to promote e-
commerce on a wider scale of digitalization (Bond, 2018). E.g. the Consumer Rights
Act that was enforced in 2015. Also in 2017 the UK digitalization strategy for post
Brexit era (Bond, 2018). These factors provide confidence in the retail industry and it
enforces a sense of security and belief on the consumer side. That online platforms
are a vital component to complete transactions. As a result consumers would have
that cognitive motivator to purchase due to the positive outlook of investment in this
avenue.
In terms of spending power complex of the consumer. Export. Gov, (2018) states that
despite the economic recovery, with unchanging salaries people are still increasing in
using online shopping for various goods to look for the finest prices that offer value for
money (Export. Gov, 2018). Hence its further emphasises that the internet has
become the innate platform for people to buy electronics, home appliances, travel
services and fashion. That are fundamental contributors to the economy also have
been integrated with the social proceedings of the UK society. Moreover consumers
have already evolved in using online platforms. As their decision to purchase focuses
on their emotional and social connection due to past knowledge and experience.
2.6.2 Marketing Campaigns by Retailers Targeting Consumer Behaviour
According to Lyons, (2018) brands are spending about 1.5 billion a year in marketing
influencer campaigns. However despite celebrity endorsements the consumer interest
results have been subpar. So, it is essential to realise that consumers are led more to
the ability to save by buying the most important product highlighting their purchase
capabilities. In terms of income, relevance and value. That is shown by the rising
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amount of online retail organisations across all product platforms (Shankar et. al,
2011).
Consumers are focused on identifying marketing elements that would attract them to
buying a product at the website that appeals to their personal shopping traits. As this
thinking is sub-consensus retailers need take advantage of this to stay ahead of the
competition. E.g. website coupons, product discounts, loyalty packages etc. This is
highlighted as shopping marketing as it deals with customers while they are in a
purchasing mode as they decide. Shankar et al., (2011; 31) states that shopper
marketing key target points can happen online as much as it happens in store.
Marketing campaigns must also focus primarily on what the consumers wants online.
There have been studies that try to comprehend the kinds of buys customers would
do online and the factors that connect such a purchase. Kwak, Fox & Zinkhan, (2002)
indicate some products may be more natural to promote online than others.
Furthermore, implies retailers knowing profile of consumers especially purchasers of
specific products online allow advertisers to target consumer needs effectively.
E.g., buying electronic products such as laptops and cellphones from Curry’s PC or
Amazon would be considered a high-risk factor by a consumer as there is no chance
of trying the product. Also, the risk of receiving a damaged or incorrect product impacts
the consumer more because of the expense factor. So some consumers with limited
finances would be justified lowing the risk. By buying products that do not have a high-
risk factors such as groceries or clothes online.
2.7 Benefits of Online Retail for Consumers
In the conventional world retail is something innovative due to its uncertainty, special
features and control factors (Kar & Quarahi, 2015). All this has played into the hands
of the consumer and has removed majority influential power from businesses. Hence
online shopping empowers customers and allows retailers to be in a supporting role.
However, this is developed through trust as a consumer feels their incentives are being
delivered online as much as they would in store. In terms of value, price and
convenience.
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Jonja & Echuali, (2003) views trust being a vital factor in B/C relationship especially in
online retail. Furthermore Gefen & Straub, (2004); Paulou & Fygerson, (2006) say that
trust is crucial to transactions whether it on the web or offline in store. So, consumer’s
intentions to purchase would be directed by honesty, competency and reputation
online (Koufaris & Acompton- Sosa, 2004). This would then allow consumer benefits
to be fully meet that can be described in table 2.2 as:
Table 2.2. Business/ Consumer Trust factors
2.7.1 Increased Accessibility to the Market
Online retail has allowed consumer’s to be involved in the market proceedings
especially with reviews and recommendations (discussed in section 2.5.3). This is
different from traditional shopping as consumers received recommendations from one
medium which would be the sales assistant. E.g. when a purchaser clicks a product
on Amazon it provides a rating according to interest, feedback and performance. This
complies 3 elements in one for the consumer to decide. Rather than traditional sales
that would usually be biased according to what the sales assistant conveys from word
or mouth.
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According to Duch Brown (2017) internet distribution channels restricts some
traditional sales. However it appeals to consumers that find the online experience
convenient. As customers can select a significant number of products that are
distinguished in quality. Moreover, consumers can have choice of shopping in store or
online. By analysing best avenues of purchase that would give value in purchase
(Duch Brown, 2017).
2.7.2 Improvement of Communication Channels
As the UK online market matures, Euromonitor, (2019) estimates that the future
development of the channel will dwindle. As consumers and retailers come to a
common understanding in what is required on online platforms to improve service and
CRM. Hence retailers are developing various technologies to cater for consumers
such as sales assistant apps. E.g. selecting product requirements on your phone
before purchase. That a consumer could use for commodities such as groceries
at ASDA. As they can have their products selected for them before arriving to the store.
That is convenient in saving time and creates integration of online and in store
services.
Echo-U, (2018) emphasises consumers want to convey the ability to order the vehicle
they see in the showroom online. In regards to discounts and samples similarly to what
is received in store. Hence retailers are expected to focus on consumer’s purchasing
journey, in connecting all the purchasing scenarios for the finest experience (Echo-U,
2018).
2.7.3 Allows Consumer to be Autonomous
Online retail provides a platform for the consumer to make a purchase anytime without
being hindered by closer times. Also, it empowers the consumer to realize what they
need on a platform that offers various products and brands. Mostly there is no pressure
hence the purchase for the consumer feels more personal. As the effort is primarily
provided by the consumer.
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According to Kwak et, al. (2002) social factors are essential in online shopping. Feick
& Price, (1987) highlights that customers rely on interpersonal sources to receive retail
advice. Such as market experts, word or mouth from close people. In the current
environment that supporting factor would come from reviews and recommendations
on retail websites and SM. As a consumer can easily access, especially as their own
profile is on the platform. Linking to their purchasing behaviour and other consumers
that have the same personality.
According to Hofstede Insights, (2019) when the UK is analysed in its social cultural
traits, it is classified as an individualistic society scoring a high 89. As people are seen
to think for themselves at an early age. Hence with online retail platforms it suites well
for the country as the consumers do not require much supporting factors to buy a
product. It is evident in store as most consumers prefer to approach a sales assistant
rather than being approached unless if it is essential. As they usually convey an idea
of what they want due to their previous buying experience and autonomous nature.
That is the reason platforms such as Amazon are popular in western developed
countries rather than developing countries. Where clarification and collectivized
discussions happen before a decision. This evidence is shown as Butler, (2019)
conveys that 90% of British purchasers use Amazon with 40% using its prime services,
with about ¼ of the adult population using prime.
2.8 Drawbacks of Online Retail to Consumers
Security seems to be an aspect that has affected online shopping. According to Jorja &
Edwald, (2003) consumers do not know how to handle personal data taken during the
retail experience. Trust can be developed for consumers benefit, but it can also be
undermined by factors such as security breaches. Mayor, Davis & Schoorman, (1995)
goes further to describe trust as the willingness of an individual to be exposed to the
act of another individual based on the emphasis. That the other party will do the task,
regardless of the capability to control or monitor the trustee.
Cassel and Bickmore, (2000) states that one to one communication in store is still
more trustworthy than online platforms. Hence this trust becomes a domino effect for
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other issues to happen. Such as slowing down the delivery process as consumers
could want clarification on the site and product details before purchase. See figure 2.4.
Figure 2.4. Integrative Framework of Consumer Trust for Online Services
Source: (Mittal, 2013)
This comes in the evaluation process as described in the diagram before in creating
choice. Also, this impacts on the impulse factors as consumers do fewer impulsive
buys online than in store (Kacen, 2003). Nevertheless, most studies suggest that
buying online is a rational procedure build on data registering and problem solving
(Verhogen & von Dolen, 2011). That can be time consuming and confusing for the
consumer, leading them to just use the traditional methods of shopping in the long run.
2.8.1 Security Fraud & Legal Issues
As the retail industry online keeps growing security factors have become a centre
piece of concern. Due to the vulnerability of online platforms and consumer
negligence. Resulting in information getting misused by external parties such as
hackers and fraudsters.
In a similar market to the UK such as the USA 59% of the public convey fraud as an
unavoidable element of online retail (Oshea, 2017). Then likewise according to
research conveyed by Pay Safe (a payments organisation) 58% are open to accept
factors that guard them from online imposters (Oshea, 2017). The author believes it is
Consumer
Trust of
Online
Shopping
Propensity to trust
Perceived
Trustworthe
ness of
Online
Platforms
Integrity
competence
Security control
Privacy control
External
Environment
Third party recognition
Legal framework
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vital to update consumers about the major security concerns such as password
updates and vigilance in recognising any malicious information on the website.
According to Menzhees, (2018) if online retail sites do not develop their platform
security, they would be at risk of losing a consumer base. Furthermore, a research
conveyed by Lexis Nexis states that online retailers are at high risk of fraud than
traditional retail outlets.
So, consumers need to look out for the following elements listed below:
Credit Card Fraud: commonly used to target consumers online.
Distributed Denial of Service Attacks: is carried out by sending many
requests to online retail servers.
Man-in- the Middles Attacks: when hackers listen to communication
between retailer and consumer online.
Bad – bots: online search engines such as Bing & Google use bots for
indexing results. However it is used maliciously by hackers to gather product
information. Also listing logins of user accounts.
Malware: hackers usually attach malicious programs to attack web
platforms, to access web retail stores.
Phishing Seams: focuses on targeted vital user information such as login
data and credit card data. A duplicated online page link can be used to
target consumer into clicking to the affected site.
So, with the list above the author believes consumers need to be informed about the
risks because it impacts on the purchasing experience. Also despite a reasonable
amount of consumers not being concerned according figures highlighted previously in
this section. It comes to reality for consumers once the fraud happens to them that
would show the seriousness of the situation. Kotheni & Cassidy (2018) stresses that
hackers can change delivery addresses once they access the consumer’s details or
even modify other aspects of the account. As customers have a habit of using the
same login detail across all their internet accounts. Meaning such small alignments
can make a significant difference in security.
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2.8.2 Delivery & Trust Factors
As online platforms continue to change the shape of online retail more consumers are
getting attracted to the platform (Mulpuru, 2008). Hence the delivery of the final
product can be difficult for some online retailers to accomplish. As consumers have
various tastes and expectations. However as discussed in section 2.5.4 consumers
mostly want the right product ordered delivered on time without any hassles. Factors
that can potentially hinder future growth are privacy of information (Yi, & Gang, 2008).
Also trusting e-commerce platforms (Novak, Hoffman & Peralta, 1998). Especially in
a retail market such as the UK. As consumers are open to transactions between
retailers because of choice abundance.
E.g., someone who has used Amazon to buy electronic products if there is a case of
their privacy being breached or products not being delivered accurately. They could
decide to change to Curry’s PC as they offer both in store and online servcies. Making
it easier to clarify with the retailer about their issues because of the physical contact
element. Hence it is vital for retailers to always have a contact platform with their
consumers as their loyalties are based on performance. (Highlighted further in section
2.8.3.)
Nevertheless, it shows that trust is vital in promoting products, brands and
organisations online as one platform impacts all 3 factors (Lynch Robert & Srinivesen,
2001). Especially when the trustor lacks power over the trustee that expresses
internet vulnerability for the consumer (Grefer & Straub, 2004)
2.8.3 Lack of Universal Interactively & Shopping Experience
The notion of risk is vital to analyse when looking at the consumer’s online shopping
experience (Kwak et. al, 2002). As a decision behaviour or action can lead to an
unexpected outcome (Bem, 1980). To understand online retail functionality there is a
sense of ‘the more it is used the better’ as consumers become experienced in
purchasing decisions.
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However, in terms of demographics those who are above 50 would struggle in
processing this information because of generational aspects as they are used to the
traditional form of experience and interactivity. Hence one major online retail drawback
is that it caters more for millennials. Leaving a demographic that is still engaged and
vital in retail transactions in the UK. According to Guiry, Magi & Lutz, (2006) customers
that are happy during the shopping journey are more likely to make repeat buys. So,
it is essential that all consumers are accommodated to satisfy their needs for future
purchases.
Additionally, Dholakra & Zhao, (2009) emphasises that traditional stores provide
various product experiences i.e. ability to feel and connect with the product that are
non-existent in online shopping. E.g., a consumer buying a laptop online at Curry’s PC
has the privilege to physically test it by trying the keyboard settings, or analysing
applications speeds. However the online consumer bases trust on information
provided on the website and word of mouth. As a result, consumers receive products
that do not appeal to them once delivered. Hence altering their perceptions about
shopping online long term. Especially with high value products.
2.9 Future of Online Shopping & its impact for Consumers in the United
Kingdom
The UK Cards Association states that Britons spend a lot of time online than any other
nation (£4611) each year. Furthermore, Kien Tan RWC retail director states a 15%
increase of online sales annually (Williams- Grant, 2017). Another study of British e-
commerce shows that 16.4% of UK population use the internet for retail shopping
increasing from 14.7% in 2016 (Asendrea, 2018). The Office for National Statistics say
despite the down fall of in store numbers online still only accounts for 17% in overall
retail purchases (The Telegraph, 2017).
Moreover, it’s been viewed by industry specialists such as Mr. Hawkins CEO of the
British Independent Retailers Association. That organisations evolving with consumer
needs around service and technology will succeed (The Telegraph, 2017).
Additionally, as consumers increase spending online it will impact on high street
retailers, nevertheless most retailers are now web orientated (Nickson, 2018).
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So, for integration of traditional systems and online elements consumers need to be
engaged in the process especially when they hold the components of purchases such
as mobile phones and computers. See figure 2.5.
Figure 2.5 Behaviour Factors to Analyse Decision Integrating Consumer Making
Source: Karimi, (2013)
2.9.1 Traditional & Online Rivalry
Despite online retail having a significant influence for consumers traditional stores are
still vital to clarify product issues. Stone (2000) highlighted major retail chains have the
leverage of using their chains to gain an advantage online. E.g., if the polo shirt that a
consumer bought online from Gap does not fit, they can easily go in store to replace
it. The question is making all these variables function.
That has led to some major retailers collaborating with solely online platforms such as
Amazon to distribute their products. An article by Toman, (2019) confirms this by
stating that Amazon and Morrison plan to extend their alliance by offering same day
delivery to more areas across the UK. That would benefit the consumer in the long
run.
According to Post, (2018) of the Business News Daily, the future fundamental trends
in online retail that would ultimately diminish traditional sales are:
Rising value of mobile material: this has become a crucial means for online
retail especially with the use of applications.
Traditional Consumer bahaviour
Online Consumer Behaviour
Decision Making Process
Cognitive
Emotional
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Propagation of value motivated retail: customers are searching for the best
offers available.
Change leading to discovery shopping: consumers are searching for more
engaging led experiences.
Modified retail experience; consumers expect most digital aspects to
be customized to their needs.
Millennials power of purchase continues to escalate as Bein & Co (Petro, 2019)
estimates that Generation Z and Millennials will represent 45% of luxury product
market globally.
2.9.2 Consumer Evolution in Decision Making
Petro, (2019) of Forbes eludes that customers are becoming more aware of their
online rights due to GDPR & Facebook that is incorporating a new era of personalities
and privacy. Furthermore 64% of customers are accepting to retail outlets saving their
product preferences and purchase history if personalization is offered more (Petro,
2019). Moreover Orendorff, (2019) conveys that e-commerce and SM are going to be
the driving force for consumer purchases online.
As most of people’s lives are shown on these platforms such as Instagram, Twitter
and Facebook. Hence once online retailers understand the consumers on these
platforms it would develop their relationship solidly. Especially as retail companies are
starting to take privacy measures seriously. Petro, (2019) indicates there is a
possibility for personalization and privacy to coexist due to ‘Zero Party Data”. That has
eliminated the 3rd party and reinforced a relationship between the customer and the
retailer.
2.10 Conclusion
To conclude the literature showed the changes that can impact cognitively in
consumer’s nature, regarding desire and impulses. Consumer’s emotions are driven
by the loyalty factors to a brand or product that has familiarity traditionally in purchase.
If online retail fails to deliver consumer needs, alternatives that provide similar service
can satisfy those needs. As it is possible due to consumer purchase power control.
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Moreover the literature shows convenience, time, web features and security measures
are vital in the online retail process for consumer satisfaction. As retail organistaions
need to increase their engagement with online retail consumers, to establish a
customer relationship that is similar to traditional retail. By taking seriously reviews
from their various market segments on their platforms.
Nevertheless in the next part the researcher wants to validate these thoughts through
applying a methodology for primary research. To assess the consumer behaviour
according to platform, product type, demographics, brand and internal + external
influences.
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3. Research Methodology
3.1 Introduction
A successful design of a research is led by a straightforward consistency between
philosophy, design layers, methodology and research approach (Saunders, Lewis &
Thornhill, 2012). This study was conveyed by reviewing the relevant literature within
the context of the consumer’s variables relating from traditional to online usage. Also
consumer behavioural traits online impacting on decision making. Hence this section
is going to clarify or challenge what has been viewed in the literature review.
In order to achieve this the author applied a comprehensive market examination of
consumer’s views using a primary data technique. To convey quantitative data that
was developed in the findings section to draw a strong argument on the topic. So, in
this case it was vital to assess the types of information needed so that the most reliable
research technique would be used to process the results adequately. Moreover this
section highlights research approach, types of research techniques, quantitative and
qualitative data differences, survey analyses, designing the survey, pilot test and
survey distribution.
3.2 Research Approach
Research approaches are actions for studies that distance the stages from wide
assumptions to specified approaches of information collection, interpretation and
analyses. Hence the plan that involves various decisions (deliberated in section 3.3),
needs to be taken in a feasible and coherent structure to make sense. As the decision
will elaborate the approach that should be used to study a topic. So in this case there
are 3 categories:
Quantitative: based on solving issues by examining numerical data (Snap
Surveys, 2011)
Qualitative: based on data that is observed and not gaged also deals with
description (Alzheimer Europe, 2009)
Mixed Methods; based on figures and observations (Shorten & Smith, 2008).
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The researcher intended to convey the survey by using a quantitative means to view
if there are any variances to the results. Also to identify anomalies and consistencies
that reflect the information highlighted in the literature review particularly in section 2.7,
2.8 & 2.9.
3.3 Research Methods
There are usually 4 types of research methods that academics use to find primary
data. That consist of surveys, interviews, observational methods and focus groups.
Hence in this paper the researcher adopted the survey as it was the best method to
apply according to the analysis.
A survey is described as a sequence of questions constructed to collect data about
people’s views about a subject also used to evaluate and gage a study (Webstar,
2015). Additionally surveys have been gradually accepted than alternative study tools
to gather information, particularly in the initial periods of an academic research phase
(Martin, 2011).
Mac Millian Study Skills (n.d.) emphasises there is a difficulty in designing a survey
because of how frequently they are used by academics and various
organisations. Also, response rates are usually an issue unless the respondents
completes it expeditiously. Layout can also be an issue in terms of repetition of
questions and respondents ticking boxes arbitrarily (Mac Millian Study Skills, n.d.).
3.4 Research Plan/ Design
According to Balakumar, (2012) critical thinking and creativity are vital elements in a
research strategy. Moreover, it is emphasised that an authentic investigation is
produced to gain knowledge and grasp the methods in significant subjects' fields of
specialisation (Balakumar, 2012). Also involves the formation of ideas and data that
generates new insights that are convenient to society. So, for researchers to have a
direction in their study methods, a philosophy is usually implemented so that research
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apparatus are employed and developed in the journey of achieving the goal, by the
study objectives and finding the solution to the problem (City. Edu, n.d.).
A study philosophy also focuses on the way data about a situation should be collected
assessed and applied. Hence there is the epistemology that implies what is considered
to be true then the doxology what is believed to be true (City. Edu, n.d.). Also, there is
ontology that suggests what is there. Being there is no right or wrong and participants
view factors differently depending on position, background and values (Vanson, 2014).
Nevertheless, preferences where filtered for the researcher to decide belief systems,
motives, constraints and guiding principles to see what events to take note of and
ignore. As the evidence is gathered it was set to create an argument that is seen as
the phenomenal flow (Jankovic, 2005). So, the researcher targeted, focused and
explored something new from the consumer’s point of view. About their retail
experience online to justify the evidence that is shown in previous studies (see section
3.4.1.). That allowed the researcher to understand about the changes in behavioural
contexts in relation to online retail. Also viewing the technology and marketing factors
that have encouraged their behaviour.
The researcher did not want to lead the participants hence an epistemology application
that is positivism in nature focus. Gave a clear view and allowed the results to be
original. Also, it being quantitative provided a better comparative analysis with
previous studies. A positivism approach enabled the study to show if the participants
are autonomous to the social norms that allows them to decide what impacts on their
behaviour (Vanson, 2014). Also highlighted decision factors conformed to a habit of
social cultural traits from shared values within a group or society (Bryman, 2001). See
figure 3.1 below:
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Figure 3.1. Research Onion Philosophy
Source: Research Methodology (n.d.)
So, with positivism being applied the researcher wanted to analyse facts by an